‘Short End’ and ‘Long End’ of the Yield Curve
Posted on 21. Dec, 2008 by khader in Finance
These are some of the informal terms used. Usually Yield Curve is formed with two sets of Maturities. They are –
1. Short Term Rates with maturities less than year
(1d (1 Day), 2d, 3d, 1w (1 Week), 1m (1 Month), 2m, 3m, 6m, 1y (or 12m) )
2. Long Term Rates with maturities more than year
(2y, 5y, 10y, 15y, 30y)
Curve that represents upto 1 year is known as ‘Short End’ of the curve and the curve that represents long term rates is known as ‘Long End’ of the curve.
These terms are also used with any forward rate curve.
Just to add, the following are the common Yield Curves -
- Treasury Yield Curve
- LIBOR Curve
- Corporates
Dirnov
02. Mar, 2009
Greatings,
Everything dynamic and very positively!
Have a nice day
Dirnov
Ravi Chandra
23. May, 2011
Thanks, Khader…this was helpful someone pointed out that
values deviated at the “Shorter end” of the yield curve. Now I
understand what it means.. –Ravi
shyam
27. May, 2011
awesome site for IT sharks in finance